The Never-Ending "Business of Centralization"

What’s wrong with placing a few limits on federal power?

On May 27, 1935, the U.S. Supreme Court handed down its unanimous decision in the case of Schechter Poultry Corp. v. United States. At issue was the National Industrial Recovery Act (NIRA) of 1933, a centerpiece of the New Deal’s first 100 days hailed by President Franklin Roosevelt as “the most important and far-reaching legislation ever enacted by the American Congress.”

FDR wasn’t kidding about the law’s reach. Through the creation of more than 500 “codes of fair competition,” the NIRA sought to micro-manage even the smallest and most local aspects of the American economy, mandating everything from the price of food to the cost of having a shirt hemmed. As justification for this unprecedented power grab, Congress cited its constitutional authority to “regulate commerce...among the several states.”

But the Supreme Court wasn’t having it. The NIRA must fall, Chief Justice Charles Evans Hughes wrote for the majority, otherwise there would “be virtually no limit to the federal power, and, for all practical purposes, we should have a completely centralized government.” Progressive Justice Louis Brandeis, usually a hero to the New Deal set, was equally blunt, informing White House lawyers Tommy Corcoran and Ben Cohen, “This is the end of this business of centralization, and I want you to go back and tell the president that we’re not going to let this government centralize everything.”

It’s worth remembering that noxious law and its well-deserved fate as the battle over federal power heats up once more. After all, if you listened only to the defenders of President Barack Obama’s health care plan, you might think there was something un-American about favoring any limits to the government’s regulatory reach.

Consider the response to last week’s ruling by federal Judge Henry Hudson—which held that requiring individuals to purchase health insurance from a private company exceeds congressional authority to regulate interstate commerce. Hudson’s decision would overturn the New Deal, cried John Marshall Law School professor Steven D. Schwinn. That’s “bad for us all, and bad for democracy.” Mother Jones writer Nick Baumann was equally apoplectic, claiming the decision “shows how the court could neuter the entire federal government.” It’s “the slippery slope to the libertarian paradise,” Baumann wailed.

There’s been a similar freak out in response to the “Repeal Amendment,” another prominent effort to limit federal power. Drafted by libertarian Georgetown law professor Randy Barnett and endorsed by politicians including Virginia Attorney General Kenneth Cuccinelli and incoming House Majority Leader Eric Cantor, this would-be 28th Amendment would empower two-thirds of the states to overturn any federal law or regulation.

It’s a plan “to blow up the Constitutional system,” moaned Talking Points Memo’s Evan McMorris-Santoro. It’s a form of right-wing “radicalism in which nothing, not even the Constitution, is sacrosanct,” asserted Slate’s Dahlia Lithwick.

The truth is less terrifying. Only a profoundly unpopular law could unite two-thirds of the state legislatures in opposition. What’s so horrible about giving the states a veto power in such rare cases? Besides, as Barnett has argued, the amendment simply “reflects confidence in the collective wisdom of the men and women from diverse backgrounds, and elected by diverse constituencies, who comprise the modern legislatures of two-thirds of the states.” What’s so illiberal about that?

As for the legal challenge to the health care law, the Supreme Court is unlikely to do more than strike down the individual mandate in a narrowly crafted opinion (if it does even that); the New Deal’s flawed legacy will almost certainly survive intact. Yet the upshot would be a long-overdue reminder to both Democrats and Republicans that the Constitution is not a blank check, that “this business of centralization” has gone too far. If that position was good enough for Justice Louis Brandeis, it should be good enough for his liberal descendants today.

Damon W. Root is an associate editor at Reason magazine.

Editor's Note: We invite comments and request that they be civil and on-topic. We do not moderate or assume any responsibility for comments, which are owned by the readers who post them. Comments do not represent the views of Reason.com or Reason Foundation. We reserve the right to delete any comment for any reason at any time. Report abuses.

  • Invisible Finger||

    Here's how well centralization works:

    http://abcnews.go.com/Health/C.....d=12452389

  • Obamacare||

    This time we'll get it right. I promise.

  • Joe Stalin||

    Like that Ukrainian agricultural reform my pals and I undertook. A complete success.

  • Obamacare||

    Your tractor production is my inspiration.

  • B.O.||

    The subtlety of this place is truly inspiring.

  • Soviet Agricultural Minister||

    All in spite of the rich peasants who wanted to eat their own food.

  • Chony||

    Externalities!

  • shrike||

    Christ-fags!

  • CatoTheElder||

    At last, the system is working!

    Nothing cuts Medicare costs as effectively as dead seniors!

  • Steve||

    Those "seniors" are baby boomers. I see this as a feature, not a bug.

  • Virginia||

    Manufacturing for doxorubicin dropped from three companies to two earlier this year after an FDA warning letter prompted TEVA Pharmaceuticals to stop manufacturing the drug.

    Atlas twitched.

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  • ||

    "The equivalent of a black market, the drugs are in full supply but sell for a much higher price – a trade that may lead to the haves getting treated, and the have-nots left waiting."

    Whereas in the properly regulated system, the haves wouldn't be able to get their medicine either, so they would also be dead. Problem solved!

    Now let's get back to more important matters, like banning those expensive cancer drugs.

  • Old Mexican||

    Hudson's decision would overturn the New Deal, cried John Marshall Law School professor Steven D. Schwinn. That's "bad for us all, and bad for democracy." Mother Jones writer Nick Baumann was equally apoplectic, claiming the decision "shows how the court could neuter the entire federal government." It's "the slippery slope to the libertarian paradise," Baumann wailed.

    Those two should instead write soap opera scripts, as they have a flair for the melodramatic.

  • RyanXXX||

    If only those things were true

  • ||

    It's "the slippery slope to the libertarian paradise," Baumann wailed.

    I think what happened was Baumann got drunk off some eggnog, fell asleep watching It's a Wonderful Life, and dreamt what a scary world it would be without central planning.

    "There... there are no roads!"

    Fortunately he woke up and realized that Democrats were in control of Zuzu's pedals, Zuzu being the metaphorical car that was driven into a ditch by Republicans.

  • ||

    What’s so horrible about giving the states a veto power in such rare cases?

    It will be used to shut down the EPA and overturn the Endangered Species act. Not that I think that would be a horrible thing. In fact i think it would be kind of awesome.

    But yeah your typical left wing troglodyte would find that horrible.

  • prolefeed||

    No, it would require two-thirds of the state legislatures. There's well more than 17 Blue legislatures that would stop any attempt to kill the EPA or ESA.

  • ||

    No sir, it would not require 2/3rds. Nullification my friend. The legal right of ANY state, being the final arbiter between itself and the federal government to ignore any law which it deems unconstitutional, and therefore void. See the Kentucky Resolutions of 1798 1799 in response to the alien and sedition act:
    1. Resolved, That the several States composing, the United States of America, are not united on the principle of unlimited submission to their general government; but that, by a compact under the style and title of a Constitution for the United States, and of amendments thereto, they constituted a general government for special purposes — delegated to that government certain definite powers, reserving, each State to itself, the residuary mass of right to their own self-government; and that whensoever the general government assumes undelegated powers, its acts are unauthoritative, void, and of no force: that to this compact each State acceded as a State, and is an integral part, its co-States forming, as to itself, the other party: that the government created by this compact was not made the exclusive or final judge of the extent of the powers delegated to itself; since that would have made its discretion, and not the Constitution, the measure of its powers; but that, as in all other cases of compact among powers having no common judge, each party has an equal right to judge for itself, as well of infractions as of the mode and measure of redress.

  • Old Mexican||

    What’s so illiberal about that?

    Anything that kills their sacred cows will be construed as "illiberal," "anti-democratic," "right-wing," "radical"...

  • Pip||

    You left off RACIST!!!

  • CatoTheElder||

    You forgot misogynistic and homophobic.

  • Mr. FIFY||

    Also:

    Ageist

    Speciesist

  • Gilbert Martin||

    "It’s a form of right-wing “radicalism in which nothing, not even the Constitution, is sacrosanct,” asserted Slate’s Dahlia Lithwick."

    This statement is a perfect illustration of the upside down and backward version of reality that resides inside the heads of leftists.

    A judicial ruling that would stop the further erosion of the actual Constitution is spun as an assault on the document by those who actively applaud virtually every assault on it that has occured since the "New Deal".

  • Number 2||

    ...and this from the same people who accuse libertarians, Tea Parties, etc., of having a "fetish" for the Constitution, and who condemn those who would consider us bound by the hidebound words and intent of "wealthy 18th Century landowners who tolerated slavery." Suddenly they are concerned about "emasculating" the Constitution?

  • Jeffersonian||

    Anything - absolutely anything - to hold on to absolute power. That is the bottom line.

  • Mr. FIFY||

    Yep, the same side that tried to turn "tenther" into an epithet/object of scorn/worshiper of the Confederacy/et cetera/blah blah/yakkety schmakkety...

  • Raven Nation||

    "far-reaching legislation":

    the phrase that provides a microcosm of the country. Some people hear it and think "cool" (whether it applies to health care or anti-terrorism laws). Other people hear the phrase and think "crap, what now?"

  • ||

    btw: illiberal does NOT mean "not liberal". It means "uneducated or unsophisticated"

  • ||

    Actually, men can attest to the word illiberal from the 1530s, taken from the 14th century French word illiberal in turn from the Latin illiberalis meaning "festering, dirty, shabby," which gave way to low, mean-spirited by the 1600s.

    No man could convey meaning if he used the word illiberal as a label for "uneducated or unsophisticated."

    Perhaps you should change your nick to "Word Pansy."

  • DDavis||

    It’s “the slippery slope to the libertarian paradise,” Baumann wailed.

    If only that were so.

  • CatoTheElder||

    It’s a plan “to blow up the Constitutional system,” moaned Talking Points Memo’s Evan McMorris-Santoro. It’s a form of right-wing “radicalism in which nothing, not even the Constitution, is sacrosanct,” asserted Slate’s Dahlia Lithwick.


    Let me get this straight ... the acknowledgement that the Constitution places some limits on federal powers threatens the Constitutional system, but wanton dismissal of any such limitations faithfully preserves the sacrosanctity of the Constitution.


    Yep, that pretty well expresses what passes for intellectual integrity among progressives and leftists.

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  • Chad||

    Government will continue to centralize, for good reason. You may as well get over it.

    The world is becoming ever more inter-connected, and both travel and communication costs are falling. As long as these trends continue, the balance between local and central government will continue to shift towards the latter.

  • shrike||

    Yeah, having state governments is messy. I agree totally... they should be forbidden.

  • J_L_B||

    Communication and travel costs were high in the 1700's and 1800's and centralized power was the norm (see Empires of England, France, Spain, etc.). Only in the mid to late 20th century did centralized colonial government decline in favor of regional control (see collapse of Soviet Union, Yugoslavia, Czechoslovakia, decolonization of Africa). Given their long history of oppression, a return to centralized government is unlikely.

    Even here in the US, the trend is now to diminish federal power in favor of state or local government regulation. Federal rather than state regulation is only needed in very few instances.

  • Van Jones||

    No, Comrade Chad is right. We need to destroy capitalism and local governments entirely and forever.

  • DLM||

    As long as these trends continue, the balance between local and central government will continue to shift towards the latter.

    I think you are probably right. However, I see no reason to rush it. Problems should be handled by the lowest level of authority (from the individual to the Feds) that can reasonably deal with it. It is not necessary for everyplace to have identical laws and regulations.

  • Mr. FIFY||

    And we all know how you feel about local government, Chad...

  • Bill||

    Better and faster communication makes it much easier for things to be de-centralized and gives people far more choices. For example - online shopping.

    At the same time, the huge increase in complexity makes it even more impossible to actually coordinate most things in a central fashion. This has been true for hundreds of years at least and the world only gets more complicated and inter-connected.

    Your arguments actually prove the opposite of your conclusion.

    Read Hayek's essay on the limits of knowledge. Any then actually use your mind and think about why anything would run better if run through congress and layers of administration. You can see every day how easy it is for money to be skimmed off and wasted and how rules are used to give friends and relatives and constituents or campaign donors advantages in business. How can something run by the government ever really be more efficient?

    I am Not arguing for zero government, but rather that this unbounded confidence that many things will be so much better and cheaper if run centrally.

    A friend of mine always wants to say there are efficiencies of scale but at the same time he is against large companies. At some point, the extra complexity of large organizations outweighs any scale factors anyway. With government you have all the additional waste and corruption and inefficiencies due to trying to run things through a regimented bureaucracy on top of the "too large" factor.

  • DLM||

    You can see every day how easy it is for money to be skimmed off and wasted and how rules are used to give friends and relatives and constituents or campaign donors advantages in business.

    I suspect, to the Liberal, this is merely one of the costs of 'civilization'.

  • fuzzysheep||

    Define "the liberal".

  • Francis W. Porretto||

    I like Barnett's idea, and am inclined to support it...but every now and then, the following passage returns to mind:

    "...it is a settled conclusion among seasoned observers that, Congress apart as a separate case, the lower legislatures -- state, county, and municipal -- are Augean stables of misfeasance, malfeasance, and nonfeasance from year to year and decade to decade, and that they are preponderantly staffed by riffraff, or what the police define as "undesirables," people who if they were not in influential positions would be unceremoniously told to "keep moving." Exceptions among them are minor. Many of them, including congressmen, refuse to go before the television cameras because it is then so plainly obvious to everybody what they are. Their whole demeanor arouses instant distrust in the intelligent. They are, all too painfully, type-cast for the race track, the sideshow carnival, the back alley, the peep show, the low tavern, the bordello, the dive. Evasiveness, dissimulation, insincerity shine through their false bonhomie like beacon lights....

    "As to other legislatures, Senator Estes Kefauver found representatives of the vulpine Chicago Mafia ensconced in the Illinois legislature, which has been rocked by one scandal of the standard variety after the other off and on for seventy-five years. What he didn't bring out was that the Mafians were clearly superior types to many non-Mafians."

    -- Ferdinand Lundberg, The Rich and the Super-Rich, 1968.

  • ||

    The Constitution isn't "sacrosanct."

    It's static.

    It says what it says, and only what it says. If you don't like what it says, amend it.

  • theunknown||

    How come people here can't read? It says among the states and not among the people within them. The power was a power that states had to regulate trade across its border. It was granted to the federal government so it can create uniform trade laws between states and even strike down trade laws. Congress has no power to regulate commerce among PEOPLE only STATES.

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